Which of the Following Statements Is False

question 184

Multiple Choice

Which of the following statements is false?

• A) Keynesians would not advocate an expansionary monetary policy to eliminate a recessionary gap if they believed that investment demand was interest-insensitive.
• B) Keynesians would not advocate an expansionary monetary policy to eliminate a recessionary gap if they believed the money market was in the liquidity trap.
• C) Keynesians would advocate an expansionary monetary policy to eliminate a recessionary gap if they believed investment spending was insensitive to changes in the interest rate.
• D) Keynesians believe that money wages are inflexible in the downward direction.

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Definitions:

Preexisting Duty

An obligation that a party is already legally bound to perform, which cannot serve as consideration for a new contract.

Foreseen Difficulty

An anticipated challenge or problem that can be predicted based on current knowledge or trends.

Preexisting Duty

Preexisting duty refers to an obligation that a party is already legally required to perform, which cannot be used as consideration for a new contract.

Past Consideration

Something given or some act done in the past, which cannot ordinarily be consideration for a later bargain.